How Is Manifest Branding Strategy Related to the Intangible Value of a Corporation?

Firms exhibit or "manifest" three types of branding strategies: corporate branding, house of brands, or mixed branding. These strategies differ in their essential structure and in their potential costs and benefits to the firm. Prior research has failed to understand how these branding str...

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Bibliographic Details
Published in:Journal of marketing 2004-10, Vol.68 (4), p.126-141
Main Authors: Rao, Vithala R., Agarwal, Manoj K., Dahlhoff, Denise
Format: Article
Language:English
Subjects:
Advertising expenditures
Branding
Brands
Business structures
Cash flow
Control variables
Corporate branding
Corporate names
Financial margins
Intangible assets
Market strategy
Marketing
MSI Special Section: Linking Marketing to Financial Performance and Firm Value
Strategic business units
Strategic planning
Studies
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Summary:Firms exhibit or "manifest" three types of branding strategies: corporate branding, house of brands, or mixed branding. These strategies differ in their essential structure and in their potential costs and benefits to the firm. Prior research has failed to understand how these branding strategies are related to the intangible value of the firm. The authors investigate this relationship using five-year data for a sample of 113 U.S. firms. They find that corporate branding strategy is associated with higher values of Tobin's q, and mixed branding strategy is associated with lower values of Tobin's q, after controlling for the effects of several important and relevant factors. The relationships of the control variables are consistent with prior expectations. In addition, most of the firms would have been able to improve their Tobin's q had they adopted a branding strategy different from the one their brand portfolios revealed. The authors also discuss implications and future research directions.
ISSN:0022-2429
1547-7185
DOI:10.1509/jmkg.68.4.126.42735